Lonnie Smiley d/b/a Smiley Drywall v. The Hartford Insurance Company

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CA 04-892

MAY 11, 2005







John B. Robbins, Judge

Appellant Lonnie Smiley d/b/a Smiley Drywall ("Smiley") appeals the entry of judgment against him by the Pulaski County Circuit Court in favor of appellee The Hartford Insurance Company ("Hartford"). The judgment was entered on January 22, 2003, and Smiley's subsequent motions to set aside and to reopen were denied, resulting in this appeal. We affirm.

A thorough examination of the sequence of events is necessary to decide the merits of this appeal. The essence of Smiley's argument is that for the relevant period of time he was acting pro se and was not served with any of Hartford's motions, and thus he was prevented from avoiding judgment being entered against him.

The case began in March 2003 with Hartford filing a complaint against Smiley to recover damages due to an apartment-complex fire that Hartford attributed to Smiley's drywall work. The complaint was served on Smiley at Route 1, Box 715, Leslie, Arkansas. Smiley's attorney, Jim Burnett, whose office is in Clinton, Arkansas, filed a timely answer

to the complaint on April 21, 2003, in which he generally denied all the allegations. On April 29, 2003, Hartford propounded Requests for Admission to Smiley that included requests to admit that Smiley's work caused the fire and to admit that Smiley owed Hartford $55,819.29 for repairs and restoration. The Requests were sent by certified mail to Burnett at his law office address, who then forwarded them to Smiley. The certified mail receipt noted that the original addressee was Jim Burnett, Esq., but the actual delivery address was P.O. Box 1400, Clinton, Arkansas, 72031-1400, which was signed by Emma Smiley, acknowledging receipt on May 6, 2003. Smiley would later acknowledge that Burnett forwarded the Requests to him. Smiley would also later state that he answered the discovery requests on or about May 20 and mailed his answers to Hartford's attorney. Smiley did not file any answers with the trial court.

On May 20, 2003, Burnett filed a motion to be relieved as counsel, asserting that his understanding with Smiley was that he was engaged as counsel solely for the purpose of answering the complaint. Burnett's motion was granted in two orders of the trial court dated July 2 and July 9, 2003.

A response to the discovery material was due on or before June 6, 2003, according to Ark. R. Civ. P. 36. Hartford denied receipt of any such response. Therefore, on July 15, 2003, Hartford moved to have the Requests for Admission deemed admitted pursuant to Ark R. Civ. P. 36. This motion was served on Burnett, and Burnett sent a letter to Hartford on July 22, 2003, noting the order relieving him as Smiley's counsel. Hartford then sent a letter to Smiley on August 12, 2003, at the address where the Requests were accepted by Emma Smiley. The letter stated that Hartford was informed that Burnett was no longer his attorney, that Hartford had not received any file-marked discovery responses, and that Hartford had filed a motion asking the court to deem his discovery requests admitted, which it was "resending." The letter then asked Smiley to forward a copy of his file-marked answers at his earliest convenience. No responses were ever filed.

In an order filed on October 21, 2003, Smiley was deemed to have admitted the Requests for Admissions.1 On November 13, 2003, Hartford moved for summary judgment based upon the Requests for Admission and an affidavit supporting the amount claimed as damages. This motion was served via regular mail upon Smiley at the same address-P.O. Box 1400 in Clinton, Arkansas.

Smiley did not file any response. The trial judge granted summary judgment, awarding Hartford $55,819.29 in damages, plus attorney's fees, filing this decision on January 22, 2004.

On April 16, 2004, Smiley filed a "Motion to Set Aside Default Judgment" and a "Motion to Reopen." The motions and Smiley's attached affidavit explained that Smiley had received the Requests for Admission through Burnett and had forwarded timely responses directly to Hartford. Smiley denied ever receiving notice of any subsequent motions or documents that followed until after judgment had been rendered against him. Smiley also asserted a defense of statute of limitations in his motions to set aside and to reopen. Smiley argued that this was not a summary judgment, but was instead a default or dismissal governed under more liberal standards for setting aside, and further that summary judgment would have been improper with many unresolved fact questions.

The trial court denied those motions in an order signed by the judge on May 14, 2004, and filed on May 17, 2004. The trial judge noted that Smiley agreed that Burnett forwarded the Requests to him and that there was a postal return receipt signed by Emma Smiley at P.O.Box 1400, Clinton, Arkansas, 72031-1400. The trial judge found that Hartford's motion, seeking to declare the Requests for Admission admitted, was forwarded to this same address, as was the motion for summary judgment. The judge was not persuaded by the bare assertion that Smiley was unaware of the Motions, and because Smiley had not ever presented a copy of his purported answers at any time, he found the Requests were properly deemed admitted months after they were propounded to Smiley. The judge held similarly with regard to the Motion for Summary Judgment, finding that Hartford provided notice of its Motion via mail. The judge disagreed with Smiley that the judgment should be considered under Ark. R. Civ. P. 55, because that rule applies to default judgments, whereas in this case appellant had filed an answer to the complaint, had received but failed to respond to Requests for Admission, and had thus provided all the fact-finding necessary to enter judgment on the merits. Therefore, both the Motion to Set Aside Default Judgment and Motion to Reopen were denied.

Smiley filed a timely notice of appeal. Smiley argues on appeal that the trial court erred in denying his motions to set aside the judgment and to reopen because: (1) the trial court erroneously considered this a summary judgment, as opposed to a default judgment or a dismissal; and (2) in the alternative, even if this were properly considered a summary judgment, there were numerous remaining issues of material fact precluding the grant of judgment.

We first consider whether the judgment entered was indeed a summary judgment, as opposed to Smiley's argument that this was either a default judgment or a judgment of dismissal. We hold that the trial court properly considered the Motion for Summary Judgment and granted it as a summary judgment.

Arkansas Rule of Civil Procedure 55(a) (2004) on default judgments states that such a judgment may be entered when the defending party "has failed to plead or otherwise defend as provided by these rules[.]" The Reporter's Note regarding the 1999 amendment to Rule 55 commented that "plead" had replaced the former term of "appear," citing to Ark. R. Civ. P. 7, which outlines the difference between pleadings and motions. Rule 7 generally describes pleadings as complaints, answers, counterclaims, and the like. Rule 7 generally describes motions as any application to the trial court for an order requesting relief. Smiley filed a timely answer to the complaint, demonstrating that he did not fail "to plead or otherwise defend." Rule 55 is simply inapplicable.

Arkansas Rule of Civil Procedure 56(c)(2) concerns the entry of summary judgment, and it states in pertinent part that:

[J]udgment sought shall be rendered forthwith if the pleadings, depositions, answers to interrogatories and admissions on file, together with the affidavits, if any, shows that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law on the issues specifically set forth in the motion.

The trial judge had before him the pleadings (complaint and answer), the admissions pursuant to discovery, and the affidavit establishing what Smiley owed in damages. When a judgment is based upon the evidence presented to the court, as opposed to being based on the failure of a party to appear or attend, the judgment is not a default judgment and Rule 55 does not apply. Harold M. v. Clark, 316 Ark. 439, 872 S.W.2d 410 (1994); Diebold v. Myers General Agency, Inc., 292 Ark. 456, 459, 731 S.W.2d 183, 185 (1987). By considering evidence in the form of the deemed-admitted Requests for Admission and the affidavit, the circuit court was entering judgment based upon the evidence. See id.

Having determined that the judgment was properly titled a summary judgment, we now consider Smiley's argument that there were fact issues remaining that precluded entry of summary judgment. We disagree with his argument. Summary judgment is appropriate when it is clear that there are no genuine issues of material fact at issue, and the party is entitled to judgment as a matter of law. Ark. R. Civ. P. 56; see also Spears v. City of Fordyce, 351 Ark. 305, 92 S.W.3d 38 (2002). Once the moving party has established a prima facie entitlement to summary judgment, the opposing party must meet proof with proof and demonstrate the existence of an issue of material fact. See id. On appellate review, we determine if summary judgment was appropriate based on whether an issue of material fact has been created and remains unresolved. Id. We view the evidence in a light most favorable to the party against whom the motion was filed, resolving all doubts and inferences against the moving party. Id. Summary judgment is viewed not as a drastic remedy, but as one of the tools in a trial court's efficiency arsenal. Chavers v. General Motors Corp., 349 Ark. 550, 79 S.W.3d 361 (2002).

Smiley asserts three primary remaining factual issues-(1) the failure of service of the motion for summary judgment and the motion to deem admissions admitted, (2) the merit to his statute of limitations defense, and (3) the substantive issues about whether Smiley observed standards of care in installation of the drywall. We disagree that those were issues of material fact.

With regard to the statute of limitations brought up as a defense in Smiley's motions, there was no question of fact because he waived the right to present that defense by not asserting it in his answer to the complaint. The statute of limitations is an affirmative defense that must be pleaded, and if not, the defense is waived. Ark. R. Civ. P. 8(c); see Medlock v. Burden, 321 Ark. 269, 900 S.W.2d 552 (1995); Heartland Community Bank v. Holt, 68 Ark. App. 30, 3 S.W.3d 694 (1999). Moving to Smiley's allegation that there remained fact questions surrounding his installation of the drywall and whether it met proper standards of care, those issues were addressed and resolved by his Requests for Admission that were deemed admitted.

Smiley's argument on appeal is in essence an attack on the finding in his motions to set aside and to reopen that he did not demonstrate lack of notice regarding Hartford's motions. That is not an appeal from the summary judgment per se. Rather, this is a challenge to the trial court's finding that the motions to set aside or reopen were not supported by that allegation. The failure of service claimed by Smiley was, as he admits, driven by a credibility determination. See, e.g., Valley v. Bogard, 342 Ark. 336, 28 S.W.3d 269 (2000) (holding that with regard to service of summons and complaint, the trial court clearly believed the testimony of process server over person to be served; trial court determines credibility of the witnesses, citing to Kelly v. Kelly, 341 Ark. 596, 19 S.W.3d 1 (2000); Holaday v. Fraker, 323 Ark. 522, 920 S.W.2d 4 (1996)). To the extent that appellant argues on appeal that the trial judge should have treated his motions as requesting relief under Ark. R. Civ. P. 60, we decline to address that argument because it is raised for the first time on appeal. Carr v. Millar, __ Ark. App. __, __ S.W.3d __ (May 26, 2004). Because we cannot conclude that the trial court clearly erred in finding that Smiley was properly served with the motions in compliance with Ark. R. Civ. P. 5, we affirm the denial of the motion to set aside or reopen.


Hart and Griffen, JJ., agree.

1 Rule 36 states that if one does not answer or object in a timely fashion, the matter is conclusively established as fact, unless the trial court is asked and grants permission to withdraw or amend the admissions.